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burden of showing the section 6662(a) penalty inappropriate here.
Again, petitioners have offered no discussion or argument on this
issue.
Petitioners reported on their 1996 return a tax liability of
$0 and disclosed neither the cancellation of debt income for
which they received a Form 1099-C nor their Social Security
payments. Based on our holdings above, however, they in fact owe
taxes for 1996 well in excess of the level constituting a
substantial understatement. Furthermore, none of the avenues of
relief provided in the statutory text is open to petitioners.
There exists no substantial authority for their complete failure
to report or disclose, so the amount of their understatement is
not subject to reduction under section 6662(d)(2)(B).
Additionally, due to the absence of explanation or evidence by
petitioners on this issue, we lack any grounds upon which to
conclude that their treatment was a product of reasonable cause
and good faith for purposes of the section 6664(c) exception.
Petitioners therefore are liable for the accuracy-related
penalty.
To reflect the foregoing,
Decision will be entered
for respondent.
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